1. 2 nd Quarter 2003 Results Presentation A member of the Li & Fung (Retailing) Group 28 July 2003

2. Hong Kong Total Retail Sales Value Year-on-year % Change * Source: HKSAR, Census and Statistics Department Jan-May 2003 :- 7% 2002 Total :- 4%

3. 2 nd Quarter 2003 Result Presentation Agenda  2 nd Quarter 2003 Financial Results Highlights  2003 Update & Outlook  Questions & Answers

4. 2 nd Quarter 2003 Financial Results Highlights Group Turnover – 2 nd Quarter No. of Stores :146 166 151 172 (HK) - 2 - 4 (China) - 2 - 4 (China) + 10%

5. 2 nd Quarter 2003 Financial Results Highlights 144 Comparable Stores Sales - 1%

6. 144 Comparable Stores Sales 2nd Quarter 2003 vs. 2nd Quarter 2002 Product Category  Cigarette + 13.1%  Non-food + 12.1%  Packaged Drinks & Beer - 10.5%  Packaged Ice Cream - 8.7%

7. 2 nd Quarter 2003 Financial Results Highlights Group Turnover – June YTD No. of Stores : 146 166 151 172 (HK) - 2 - 4 (China) - 2 - 4 (China) + 9% 666.0 727.2

8. 2 nd Quarter 2003 Financial Results Highlights Group Net Profit – 2 nd Quarter + 2% * Restated for Income Tax Effect Per SSAP No.12 * * *

9. 2 nd Quarter 2003 Financial Results Highlights Group Net Profit – June YTD - 9% * Restated for Income Tax Effect Per SSAP No.12 * * 26.2 23.8 *

10. 2 nd Quarter 2003 Financial Results Highlights Net Profit as % of Sales – 2 nd Quarter - 0.3% * Restated for Income Tax Effect Per SSAP No.12 * * *

11. 2 nd Quarter 2003 Financial Results Highlights Net Profit as % of Sales – June YTD - 0.6% * Restated for Income Tax Effect Per SSAP No.12 * * *

12. 2 nd Quarter 2003 Financial Results Highlights Basic Earnings Per Share – 2 nd Quarter * Restated for Income Tax Effect Per SSAP No.12 * * *

13. 2 nd Quarter 2003 Financial Results Highlights Basic Earnings Per Share – June YTD - 0.4 Cent * Restated for Income Tax Effect Per SSAP No.12 * * 4.0 3.6 *

14. 2 nd Quarter 2003 Financial Results Highlights 2 nd Qtr 2002 2 nd Qtr 2003 Changes Group Turnover (HK$ Million) 343.4377.6 + 10% Group Net Profit (HK$ Million) 16.3 * 16.6 + 2% Net Profit as % of Sales 4.7% * 4.4% - 0.3% Basic Earnings Per Share 2.5 Cents * 2.5 Cents - Dividend - 1.0 Cent + 1.0 Cent * Restated for Income Tax Effect Per SSAP No.12

15. Why 2 nd Quarter 2003 Results? Lower Gross Margin/Other Income - 1%

16. Why 2nd Quarter 2003 Results? Lower Expenses as % of Sales Expenses as % of Sales 2003 vs. 2002  Store Operating Expenses - HK 0.8Lower - China - China(0.3)Higher  Distribution (0.3)Higher  Administrative Expenses (0.2)Higher  China Start-up Expenses 0.4Lower 0.4Lower

17. Why 2 nd Quarter 2003 Results? Net Profit By Market 2 nd Qtr 2002 2 nd Qtr 2003 Changes (HK$ M) Hong Kong Market 17.518.71.2 China Market (1.2)(2.1)(0.9) Total16.316.60.3

18. 2003 Update & Outlook

19. 2003 Update & Outlook Circle K Hong Kong  SARS Impact Minor  Higher Unemployment & Deflation  Hong Kong Retail Sales Improving But Lower Than 2002’s  Growing Pressure on Comparable Store Sales & Gross Margin  Rental & Labour Cost to Decrease

20. 2003 Update & Outlook Circle K Hong Kong Tactics Defensive Tactics  Lower Product Costs & Pricing  Maintain Gross Margin  Reduce Operating Expenses  New Store Opening Only with Right Economics

21. 2003 Update & Outlook Circle K Hong Kong Tactics Offensive Tactics  More Aggressive Promotions:  Micro-wave Lunch Boxes  Tie-in Promotions with Coca-Cola  Increase STF (Speed, Tidiness & Friendliness) Gap Versus Competition  Localization of Stores  “Hot & In” Counters in Commercial Areas

22. 2003 Update & Outlook Circle K Store Growth Hong Kong  Beginning of Year 166  Opened So Far (as at 28 July 2003) + 9  Under Construction / Committed + 6  Target Store Number at End of the Year 190

23. 2003 Update & Outlook Circle K China  Strategies of Differentiation and Hard to Copy Very Important  “Hot & In” Right Strategy  Increasing Customer Preference & Weekly Sales  Need Improvement in Category Management & Marketing/Promotion  Harder to Find Good Sites with Right Size & Right Rental

24. 2003 Update & Outlook Circle K China Benefits of CEPA 1.Wholly-owned Enterprise 2.Prefectural & County Cities 3.Lower Qualifying Requirements 4.Flexibility & Efficiency

25. 2003 Update & Outlook Circle K China  Add Resources and Expedite Store Development  Review & Refine Business Model to Cut Down on Investment & Sizing  10 – 15 Stores by Year End  Developing A Smaller Store Model  Uphold Strategies  Available for Franchising  Quickly Build No. of Outlets  Add Expertise in Category Management

26. 2003 Update & Outlook  Tough Hong Kong Market Conditions  Profitability and Cash Flow from Operations Still Healthy  China Strategies on Track But Need to Refine Model & Speed Up Expansion  Uncertain Profitability Outlook for 2 nd Half 2003